Student Project by Alexander Frieß & Patrick Freialdenhoven
How far is Rupert Murdoch involved in European media?
Based on the knowledge acquired in previous lessons, this student project is focused on Rupert Murdoch`s influence in European, especially in German media.
Rupert Murdoch is one of the most influential entrepreneurs in world-wide media. His media enterprises together reach about three quarters of all mankind.
After reaching the position of a market leader in his home country Australia, Murdoch started to expand his enterprise “News Corporation” world-wide. The first step was the purchase of the two big British newspapers “The Sun” and “News of the World” in 1969. Understanding the importance of the European market, he invested more and more in the British media. In 1976 he bought the broadsheet “The Times”, in 1987 “UK Today”.
Controlling a big part of the print media in Great Britain, Murdoch started in 1989 to set up the first European satellite broadcaster “Sky Channel”, which merged with the “British Satellite Broadcasting” (BSB) to form “BSkyB” in 1990. “BSkyB” is today one of the biggest news channels broadcasting in the whole world.
In the beginning of the Nineties, Murdoch discovered the potential of the German media sector. In 1991 Murdoch`s “News Corp” bought holdings in the German tabloid “Super!”. This Eastern-German counterpart of “Bild-Zeitung” had no success and was shut down one year later.
Because of the fast growing interest in audio-visual media, Murdoch invested in the German television market. Murdoch bought his first shares in 1994, acquiring a 19.9 % holding in the private TV channel “Vox”, which was in danger of going bankrupt. Later, this holding was increased up to 49.9 %.
Having bought the right to broadcast the successful movie “Titanic”, “Vox” was suddenly up for a merger with “RTL Television”. In 1999, Murdoch sold “Vox” to “CLT Ufa”, the owner of “RTL”. Probably, it was Murdoch`s strategy to give “Vox” the movie as a “present” (the producing enterprise “20th century Fox” is a part of his “News Corp.”), to sell his “Vox” holdings at a high price.
Murdoch`s entry into the German Pay-TV was the purchase of a 25 % holding in “Premiere” in 1996. Two years later, Murdoch planned to expand his influence in the German free TV sector. He bought 66 % of “tm3”.
Beside his expansion in Germany, the media-mogul did not forget about the other European countries. His attempt to get holdings of an Italian Pay-TV channel failed because of opposition by the owner Silvio Berlusconi in 1998.
In 1999, there was a holding exchange between Murdoch`s “BSkyB” and Leo Kirch, the German media-mogul. Kirch got 4.3 % of “BSkyB”, Murdoch got a 24 % holding of Kirch`s “Premiere World”.
Having no success in starting into the Italian media world the year before, he bought 35 % of the Italian Pay-TV channel “StreamSPA” in 1999. In the same year he succeed to purchase the Norwegian channel “Tandberg Television”. In the year 2000, Murdoch got the first private television and radio licence in Bulgaria and set up the “Balkan News Corporation” (BNC).
On his way to success in Europe, Murdoch changed the face of the German women-channel “tm3”. After having purchased the right to broadcast the Football Champions League in 2000, Murdoch got all holdings of the channel.
As a result of the recession in the media sector, Murdoch had to sell “Tandberg TV” and “tm3” one year later.
At the beginning of 2002, Murdoch played a big role in Germany again. When he bought his holdings in “Premiere World” he negotiated an option to sell them back to Leo Kirch, if the bad financial circumstances of the enterprise would not change. In the autumn 2001 “Kirch Media” lost its ability to pay. Murdoch hoped that the conditions would improve but in January 2002 Kirch got his holdings back. This was probably another strategic move by Murdoch because one month later Kirch´s media enterprise had to report insolvency.
According to his anouncements, Murdoch is not likely to purchase non-English print media in future, because he is “not able to read it”. The Australian media-mogul does not intend to expand political news reporting in Europe, he rather plans to focus more on the entertainment sector.
Sources: www.ftd.de
www.diewelt.de
www.tv-quoten.de